JAKARTA (TheInsiderStories) – PT Pelabuhan Indonesia III (Pelindo III), a state-owned port operator and DP World Limited (Dubai Port) agreed to sign a conditional sale and purchase agreement (CSPA) for 49 per cent shares of PT Terminal Petikemas Surabaya (TPS) on Jan. 12.
Repurchase of TPS shares by Pelindo III is part of the planned termination of cooperation with Qatari port operator by April 2019. President Director Ari Askhara told The Insider Stories the purchase value of the share buyback amounts to approximately Rp490 billion (US$36.57 million).
Dubai Port became a shareholder of TPS after acquiring the parent stock of P&O Dover in 2006. P&O Dover owned 49 per cent of TPS shares from 1999.
Last year, DP World announced that the company had reached a decision not to renew its operating contract for TPS in Indonesia at the conclusion of the agreement in 2019. DP World is a 49 per cent shareholder in TPS, representing a gross capacity of 2.1 million (twenty-foot containers) out of 85 million TEUs for the Group.
Sultan Ahmed Bin Sulayem, DP World Group Chairman and CEO, said: ‘We are therefore disappointed that the operating contract renewal terms offered by the Indonesian authorities did not meet our threshold for continued investment.’
Law No.17 of 2008 on Shipping is, according to Askhara, not very attractive for investors such as DP World, especially with regard to the mechanism for tariff determination and adjustment, which is quite long because it must involve a service user association as determined by the Minister of Transportation.
Furthermore, Ari explained, following the termination, Pelindo III opened stock exchange option with other state-owned enterprises port operators.
‘We offer a share swap with Pelindo I and Pelindo IV; for example, we can go to the Makassar New Port project,’ He said.
TPS is located on the northern shore of East Java along the edge of Madura Strait. The port is gateway to Eastern Indonesia, serving international and domestic trade for wide-ranging destinations in the hinterland.
Written by Linda Silaen, Email: firstname.lastname@example.org